While the International Financial Reporting Standards (IFRS) net profit after tax was $3.4m, down $1.6m on the previous corresponding period (including a $1m after tax profit on the sale of the group’s investment in National Mortgage Brokers), the net profit after tax on a normalised basis was $3.5m – up from $2.7m for the six months to 30 June 2013.

Lending volumes increased 12.4% compared with the previous corresponding period, and were up 6.8% on the six months to 30 June 2013. Homeloans-branded loan settlements were up 9.8% on the previous corresponding period, the company reported.

The increase in lending volumes reflects the improvement in the home lending market and housing credit growth, Homeloans chairman Tim Holmes said.

In the six months to 31 December 2013 housing credit rose 2.9%, with growth in investor housing credit at 3.9% for the same period.

But there remains “omnipresent competition” in the market from the major lenders, Holmes said.

“This has included aggressive discounting in the broker space combined with enhancements to commission structures for third party brokers to support volumes.

“Despite the competition, however, we see this as an opportunity for Homeloans. Our business model and sole focus on home lending enables us to be agile, and providing what the banks can’t," he said.

“For example, we have increased our number of funding lines and, as such, continue to grow our product range to suit a wider range of lending policies and nearly all types of borrowers.”

Australian Broker asked Homeloans CEO Scott McWilliam whether the company had any plans to compete with other lenders in regards to rate cuts and broker commissions.

“Look, I think all lenders will say ‘absolutely’,” he said. “But what we’ve got out there on the market today is extremely competitive, and we will continue to be extremely competitive through broker originated loans, and also retail originated loans.

“We’re looking to grow volume in the future, and to do so we will remain competitive in the market.”

Homeloans plans to boost its funding lines by entering a wholesale funding arrangement with major shareholder Macquarie Bank, with a formal product launch planned for March 2014.

“This all means we are well-positioned to grow our distribution and settlement volumes as we move into a period of expected inactivity in interest rate movements through to the likelihood of rate increases later in the calendar year.”

Homeloans’ strategic growth initiative is to further grow its product offering through its broker channel, plus its retail and online channel, McWilliam said.

“We continue to focus on refining our product offering and identifying opportunities to further expand our national distribution footprint.”

The company, almost 30 years old, is also focusing on brand recognition through targeted marketing campaigns – such as being associated with the Perth Scorchers during the recent T20 Big Bash competition.